Summary
Starbucks Corporation's 2011 10-K report highlights a year of robust growth and improved profitability, driven by strong performance in its company-operated stores, particularly in the United States, and continued international expansion. The company demonstrated resilience despite headwinds from rising commodity costs, effectively leveraging increased sales and optimizing store-level economics to drive an 8% increase in global comparable store sales. This growth translated into higher operating income and a significant improvement in earnings per share (EPS) to $1.62. Key strategic initiatives included refining store operations through technology upgrades, expanding the food warming program into new markets like China, and successfully transitioning its consumer packaged goods business to a direct distribution model. The company also continued its disciplined approach to store growth, with a primary focus on international markets, while managing its capital effectively through share repurchases and dividend payments. Management expressed confidence in its business model and brand strength, setting a positive outlook for fiscal year 2012.
Financial Highlights
57 data points| Revenue | $11.70B |
| Cost of Revenue | $4.92B |
| Gross Profit | $6.78B |
| Operating Expenses | $10.18B |
| Operating Income | $1.73B |
| Interest Expense | $33.30M |
| Net Income | $1.25B |
| EPS (Basic) | $0.83 |
| EPS (Diluted) | $0.81 |
| Shares Outstanding (Basic) | 1.50B |
| Shares Outstanding (Diluted) | 1.54B |
Key Highlights
- 1Consolidated net revenues increased by 9% to $11.7 billion, primarily driven by an 8% rise in global comparable store sales.
- 2Operating income grew to $1.7 billion, with operating margin expanding to 14.8% from 13.3% in the prior year, despite higher commodity costs.
- 3EPS rose to $1.62, up from $1.24 in the previous year, aided by improved sales leverage and certain one-time gains.
- 4Company-operated stores generated 82.3% of total net revenues, with the US segment accounting for the majority of sales.
- 5International net revenues increased by 15%, reflecting foreign currency translation benefits and a 5% rise in comparable store sales.
- 6The company successfully transitioned its consumer packaged goods (CPG) distribution to a direct model, contributing to a 22% revenue increase in that segment.
- 7Starbucks returned approximately $945 million to shareholders through share repurchases and dividends in fiscal 2011.